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Insurers misuse mental health diaries, AFA says

The Association of Financial Advisers (AFA) has called for standards and set periods around the use of daily activity diaries during mental health claims.

In response to a question raised at recent parliamentary life insurance inquiry hearings, the AFA says there must be a threshold for the process.

“We question how a daily activity diary completed by a person claiming to be mentally unwell can be beneficial to understanding their claim,” GM Policy and Professionalism Samantha Clarke says in a written answer.

“There must be a consideration – and it must be a health professionals’ consideration – of how such an intricate examination of the person’s activities may affect their condition.”

Ms Clarke says the use of daily activity diaries is increasingly common when handling income stream claims longer than three months.

She says the diaries are used to justify taking people off claims.

“Even parolees who have actually been found guilty of criminal activity in an independent court of law do not have this level of scrutiny into their daily movements.

“Although fraud does unfortunately take place, it is and should be approached as the exception to the rule.”

The AFA says insurers should set out the purpose of such diaries, information must have a constructive purpose, and advice must be sought from the claimant’s medical practitioner showing how a diary will assist in recovery.

This information should be given to the claimant so they understand why they are asked to perform the task.

“Without appropriate checks and balances to mitigate against their continued abuse, daily activity diaries will continue to be used for improper purposes,” the response says.

“The AFA recommends the [parliamentary joint] committee seek evidence from insurers about their use of daily diaries and consider whether those practices should continue in their current form without oversight.”

The association wants diary requirements limited to a month or two, depending on claimant circumstances.

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